Three months into DPC Regulation: What firms are learning in practice

When deferred payment credit (or DPC), a form of BNPL, became regulated on 15 July 2026, the priority was readiness: permissions, products, customer journeys, and systems. Having supported lenders, retailers, and fintechs through that process, we are now seeing similar questions emerge as firms put the new framework into practice. These are not just legal questions. They affect product design, operations, and commercial strategy, and there is no single right answer for every business.

Flexibility is valuable, but it creates difficult judgement calls

One of the most interesting aspects of the DPC regime is what the FCA chose not to do.

Rather than applying the existing consumer credit framework wholesale, it introduced a more tailored regime that reflects how DPC products work and how customers use them. This is particularly clear in the approach to pre-contractual information. Traditional regulated credit agreements remain subject to detailed, prescriptive disclosure requirements, whereas the DPC regime gives firms more flexibility in how certain information is presented.

The distinction between key product information, which must be actively provided to customers, and additional product information, which may be made available, reflects a broader shift in regulatory thinking. The focus is increasingly on whether information actually helps customers understand the product, rather than simply whether it has been delivered in a prescribed format.

That fits with the Consumer Duty’s emphasis on customer outcomes. But flexibility is not the same as simplicity. The more room firms have to choose their approach, the more judgement they need to exercise and may need to defend.

Existing processes may provide a starting point

A question that keeps coming up in our work with firms is how far existing regulated credit documentation, customer journeys, and governance arrangements can be adapted for DPC.

There are good reasons to build on what is already there. It can help firms stay consistent, keep operations simpler, and avoid unnecessary implementation costs. However, the requirements under the two regimes are not identical. Firms need to identify and address the differences, rather than assuming documentation designed for another regulated credit product can be carried across unchanged.

The fact that existing documentation contains broadly the same information does not necessarily mean that it satisfies the specific DPC requirements or presents the information in the clearest and most effective way for a DPC customer. Equally, the introduction of a more tailored regime may not mean that firms must develop entirely new documentation and processes, where proportionate amendments to existing arrangements meet the applicable requirements and support good customer outcomes.

There is unlikely to be a universal answer. The real question is whether the solution works for the particular product, target market, and customer journey, and whether the firm can explain why it made those choices.

Compliance decisions are also commercial decisions

For many businesses, the challenge is not just meeting the rules. It is doing so in a way that also works commercially. Decisions about disclosures, customer journeys, and governance can affect customer experience, conversion, operational complexity, and time to market.

Some of the most useful discussions, therefore, go beyond the legal position. They are about finding an approach that meets regulatory expectations, delivers good customer outcomes, and works for the business. Two firms may meet the same regulatory requirements in very different ways, with significant implications for regulatory risk, customer experience, and commercial performance.

That is why interpreting the rules is only part of the job. Legal, compliance, product, and operational teams need to work together and understand both the regulatory aims and the commercial consequences of their choices.

The real test is whether firms can evidence their decisions

Under a more prescriptive framework, firms can often demonstrate compliance by showing that they followed a required process or provided particular information. An outcomes-focused framework asks more of them. Can they show that their approach meets the applicable requirements and delivers the intended customer outcomes? The reasoning behind their decisions matters more.

Firms need to consider not only what they have done, but why the approach is appropriate, what evidence supports it, and how they will monitor whether it continues to work as intended.

Flexibility does not mean less need for careful regulatory analysis. In some respects, it means more.

What does this tell us about wider CCA reform?

The practical experience of implementing the DPC regime may also offer an early indication of what wider reform of the Consumer Credit Act 1974 (CCA) could mean for businesses. The Government has confirmed its intention to move towards a more flexible consumer credit framework, including abolishing a number of requirements (including draconian sanctions) and transferring many of the CCA’s prescriptive information requirements into FCA rules.

The aim is to create a regime better suited to modern financial products and digital customer journeys while preserving an appropriate level of consumer protection. In principle, there is much to welcome in that approach. Prescriptive requirements can provide legal certainty, but they do not necessarily ensure that consumers receive information in the most accessible or effective way. Greater flexibility can support innovation and allow firms to develop approaches suited to their products and customers. But the early experience of DPC also illustrates the challenge at the heart of that model.

Firms need enough flexibility to design products that work, but also enough certainty to invest, develop products, and enter markets with confidence. Overly prescriptive rules can limit innovation and encourage firms to follow the letter rather than the purpose of the rules. Too little clarity can leave firms facing uncertainty, inconsistent approaches, and unnecessary compliance costs.

DPC may prove an important test case. Not because its rules should necessarily be replicated elsewhere, but because it shows what businesses need when operating under a more flexible framework.

What should firms be thinking about now?

Three months in, firms should be moving beyond the question of whether the initial implementation exercise has been completed. The more important questions now include:

• Does the approach work as intended in practice?
• Can the business explain and evidence the judgements it has made?
• Are customer journeys producing the anticipated outcomes?
• Is the operating model proportionate and commercially sustainable?
• Are legal, compliance, product, and operational teams aligned?
• What lessons can be applied to future product development and wider CCA reform?

It is still early days. The authorisation process, firms’ practical experience of operating under the regime, and future FCA supervisory activity will all provide further insight. However, DPC regulation is already demonstrating both the opportunities and the challenges of a more flexible, outcomes-focused approach.

Our work with firms has reinforced that these questions go beyond legal compliance. They affect product design, customer experience, operations, and commercial strategy. The firms best placed to succeed will not necessarily be those that have built the most elaborate compliance framework. They will be those who understand where the rules allow flexibility, make considered choices about how to use it, and can show that those choices work for both customers and the business. As wider CCA reform progresses, that combination of regulatory judgement and practical implementation is only likely to become more valuable.